Understanding the Motivations Throughout the Stages of a Social Enterprise's Life Cycle.
| Autor | Lehmen, Larissa Martins |
INTRODUCTION
Social entrepreneurship involves the process of innovation using a combination of resources to catalyze social change and meet social needs (Dees, 1998; Mair & Marti, 2006). According to Doherty, Haugh, and Lyon (2014), social enterprises seek the dual mission of having a social purpose and achieving financial sustamability not fitting perfectly into the conventional categories of private, public, or non-profit organizations. In addition, its goals are rooted in the values of its founders (Zahra et al., 2009), such as the desire for change in society aimed at social well-being (Bacq et al., 2016; Renko, 2013). For Zahra et al (2009), it is necessary to value the motivations of individuals and groups that assume the risks associated with the design, construction, launch, and maintenance of new organizations and business models. Even so, the motivations are accompanied by substantial challenges throughout the life cycle of social enterprises.
There are several risks during the life cycle of these businesses (Zahra et al., 2009), in different stages of development until the business reaches maturity and establishes itself in the market (Oliveira & Fukayama, 2018). The life cycle of a social enterprise begins with the identification of a social problem (Limeira & Freire, 2018) and the search for solutions in a business idea (Vasconcelos & Lezana, 2012), aiming at a valid business model (Limeira & Freire, 2018; Oliveira & Fukayama, 2018; Sen, 2007). Finally, the entrepreneur seeks scale and resources for company growth in order to find space in the market and ensure social impact (Cremonezzi et al., 2013; Limeira & Freire, 2018).
Thus, despite being the subject of some research, understanding the motivations of social entrepreneurs remains a suggestion for future research by different authors (Germak & Robinson, 2014; Gupta et al., 2020; Stephan & Drencheva, 2017). In addition, there are few studies that relate the motivations of the social entrepreneur to the course of the social enterprise. Stephan and Drencheva (2017) suggest that future research explores changes in entrepreneur motivations and personality throughout the social enterprise life cycle. Germak and Robinson (2014) indicate the need for comparative research on motivation between nascent and mature social entrepreneurs. Furthermore, Saebi et al. (2019) stress the importance of associating the individual and organizational level in research on social enterprises. In this context, there is a research gap regarding how these motivations present themselves over time and how they impact and are impacted by the life cycle of a social enterprise.
We start from the argument that, during the different stages of business development, different motivations stand out and alternate. Understanding how and what motivations are manifested during the life cycle is important in the search for the strengthening and continuity of the social enterprise. In this way, the present work seeks to answer the following research question: 'How are the social entrepreneur's motivations presented during the stages of the life cycle of social enterprises?'
The results indicate that there are three types of motivational factors: essential factors, building factors, and solidifying factors. The essential factors run through all stages of the life cycle, the building factors are concentrated in the ideation phase, while the solidifying factors are distributed throughout all stages of the life cycle.
From a theoretical point of view, our research expands knowledge about social entrepreneur's motivations, bringing a novelty relating motivational factors to the stages of the life cycle of social enterprises. From a practitioner point of view, entrepreneurs can analyze what stage of the cycle they are in and what motivations they can mobilize for the development of social enterprises. Moreover, training and development programs can be developed in a way that is more aligned with the stage of life of social enterprises.
THEORETICAL REFERENCE
Social entrepreneurship and social enterprise
Mair and Marti (2006) define social entrepreneurship as the process of using innovative combinations of resources to catalyze social change and meet social needs. For Austin, Stevenson, and Wei-Skillern (2012), the term describes a value creation process that occurs within or across the non-profit, commercial, or government sectors. Allied to these definitions, it is also important to note that social enterprises seek the dual mission of having a social purpose while remaining financially sustainable (Comini et al., 2012; Doherty et al., 2014). In the quest to solve social problems, such as poverty or the environmental crisis, they identify opportunities and create types of services and products for the community (Petrella & Richez-Battesti, 2014), associating the social role with the company's strategy (Barki et al., 2020). In this context, the social entrepreneur plays a central role in the social enterprise, conceiving the initial idea, launching and working to sustain the business (Germak & Robinson, 2014), with the company's goals being deeply linked to its personal values (Nicolas Martinez et al., 2019; Zahra et al., 2009).
In addition, these social enterprises have different terminologies, such as social, inclusive, socio-environmental, social impact, periphery impact, and social enterprises (Barki et al., 2020). These definitions may vary globally, mainly due to the variety of context that these companies find themselves in (Gongalves et al., 2016; Rosolen et al., 2014). In Brazil, the most used term is social impact business, businesses that aim to generate social impact and financial return from the offer of products or services that reduce the vulnerability of the low-income population (Barki, 2015). For Petnni, Scherer, and Back (2016), social impact businesses can also include individuals and groups in order to solve demands related to societal problems. Pipe Social (2021) emphasizes the commitment to assessing the social and environmental impact that these businesses generate, in order to improve their effectiveness throughout the company's life cycle. In this research, we will focus on social entrepreneurship and social enterprises from the Brazilian perspective of social impact businesses.
Stages in the life cycle of a social enterprise (SE)
The life cycle of a company refers to the various stages of development until reaching the maturity of a business in the establishment in the market in which it is inserted (Oliveira & Fukayama, 2018). Social enterprises have a life cycle that encompasses the stages of their development with their respective challenges and barriers (Limeira & Freire, 2018). In addition, based on the literature reviewed, a comparative analysis was carried out to identify overlaps and complementarity between authors, as shown in Table 1, with color shading indicating similar characteristics and challenges, allowing for comparison between authors.
Based on this analysis, a model of four stages of the life cycle of a SE is proposed, as shown in Figure 1. Of the six stages found in the literature, the four chosen are the ones that have the greatest representation among the authors and from that, it is carried out a remterpretation and a new model is proposed.
The life cycle begins in the ideation stage with the objective of identifying and seeking a solution to a social problem through a business idea. Validation follows, in which the social entrepreneur develops a business model and validates the solution through a pilot test. In the growth stage, the purpose is to seek scale and more robust investments to develop the business. Finally, maturity is when the business seeks to consolidate itself in the market with a surplus and great social impact. By advancing through the stages of the life cycle, with their intrinsic and particular challenges, the company increases its social and environmental impact. The more mature the company, the greater the scope of its positive impact.
Social entrepreneur motivation
An individual in control of an organization is usually able to impose his vision on it, and some undertake the creation of social enterprises for reasons that derive mainly from their willingness to see social change (Renko, 2013). While social entrepreneurs share similar work patterns and experience to commercial entrepreneurs, there are significant differences in their social motivations. There is a priority given to the creation of social wealth in relation to the creation of economic wealth (Bacq et al., 2016; Mair & Marti, 2006), motivated by different factors, such as the desire to make changes in society and meet local needs, which can be seen in the company's mission (Austin et al., 2012).
The motivation of social entrepreneurs can be intrinsic or extrinsic. According to Carsrud and Brannback (2011), extrinsic motivations are linked to wealth, status, and external rewards that arise from entrepreneurship, while intrinsic motivation is linked to success and achievement of goals. Intrinsic motivations are associated with prosocial motivations (Grant, 2008), the desire to mobilize efforts based on concern for others (Batson, 1995). Social entrepreneurs are characterized by a strong relationship with intrinsic motivation through interest and passion for social entrepreneurship, dissatisfaction with previous work, the opportunity to be independent (Carsrud & Brannback, 2011; Stephan & Drencheva, 2017) and with a prosocial motivation, through a passion for helping others and creating a better life for future generations (Miller et al., 2012; Stephan & Drencheva, 2017). Even thought, Zhag, Peterson, and Hujala (2021) show in their case study that the motivation of social enterprise is pure social, including improving people's mental condition, employability, and promoting public education. Yet, for Ashta (2020), social entrepreneurs are...
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